SCA Sustainability Report 2009 English

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SCA publishes a separate sustainability report each year. The report describes the environmental, social and economic perspectives of SCAs sustainability initiatives, and is aimed at specialist audiences with an interest in SCAs sustainability performance, including analysts, investors and NGOs.Read more on www.sca.com

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<p>SCA Sustainability Report 2009</p> <p>Because our products make life easier for you and millions of people around the world. Because our resources and processes are a natural part of the global lifecycle. And because we care.</p> <p>ContentsSCA at a glance CEO message 2 4 8 10 12 13 18 21 26 31 33 35 38 41 44 47 51 55 57 64 65 66 68 69 71 73</p> <p>Sustainability strategyTargets Integrating sustainability into strategy Governance Ethics and core values Stakeholder dialogue</p> <p>RecognitionSCA was named one of the worlds most ethical companies by the Ethisphere Institute. SCA was ranked as one of the worlds most sustainable companies by the responsible business magazine Canadian Corporate Knights.9 10</p> <p>Risk</p> <p>Environmental responsibilityClimate and energy ForestSCA is included in the Dow Jones STOXX Sustainability Index and the Dow Jones Sustainability WORLD Index, which are two of the worlds most prestigious sustainability indexes.</p> <p>Water Chemicals and product safety</p> <p>Social responsibilitySCAs Code of Conduct Employee relations Health and safety Community involvement</p> <p>The insurance company, Folksam, compiles an annual index for responsible business practices. In 2009, SCA shared the top spot when the marks for the environment and human rights were combined. SCA was honoured with the 2009 Finforum award by FAR SRS an industry organisation for auditors and consultants the Swedish Society of Financial Analysts SFF, the Swedish Public Relations Association and Irev. The commendation focused on SCAs expressed desire to contribute to sustainable development. In 2008, SCA became a UN Global Compact member. SCAs 2008 Communication on Progress report was selected as representative of Best Practice by Global Compact. SCA applies the Global Reporting Initiative (GRI) at A level in its sustainability reporting. The report was audited by PricewaterhouseCoopers.</p> <p>SCA has been listed on the FTSE4Good global sustainability index since 2001. In 2007, the Hanover Stock Exchange and the research company Oekom Research AG introduced the Global Challenges Index. SCA is listed on this index.</p> <p>Economic responsibilityShareholders Stakeholders</p> <p>Control and assuranceRMS Environmental data Social data About the report GRI Index Global Compact report Assurance report Glossary Addresses</p> <p>2009</p> <p>FINFORUMPRISETtilldelas</p> <p>Svenska Cellulosa Aktiebolaget SCASCA har i sin kommunikation gjort ett snabbt skifte frn det traditionella skogsfretaget som upplevts att ha varit i bakvatten till ett framtidsinriktat konsumentfretag med stark kund- och konsumentinsikt. SCA har visat att de skapar vrde i en anda av innovation och med en uttalad vilja att bidra till en hllbar utveckling. Fretaget har en gedigen ekonomisk information och en stor ppenhet p sin hemsida. SCA har i denna frndring visat mod, kraft, handling och transparens.</p> <p>Anna-Clara af Ekenstam Juryns ordfrande</p> <p>SCA is included in Kempen SNS SRI Universe and was approved for inclusion in the Orange SeNSe Fund. SCA is included in OMX GES Sustainability Nordic and OMX GES Sustainability Sweden, two indexes for responsible investments launched by Nasdaq OMX and GES Investment Services.</p> <p>SIX STAR is a Nordic sustainability index launched in 2009 by SIX and the consultant Ethix. SCA is ranked among the top 25 Swedish companies.</p> <p>About this report SCA publishes a separate sustainability report each year. The report describes the environmental, social and economic perspectives of SCAs sustainability initiatives, and is aimed at specialist audiences with an interest in SCAs sustainability performance, including analysts, investors and NGOs. As of 2008, SCA is a signatory to the UN Global Compact. The sustainability report represents the Groups Communication on Progress, describing SCAs work to address the Global Compacts ten principles on human rights, working conditions, the envi-</p> <p>ronment and anticorruption. The Global Reporting Initiative guidelines, level A, are applied in this report, and the GRI content index (p. 6667) provides a cross-reference to the indicators included in the report. The entire report has been reviewed by PricewaterhouseCoopers. All data in this report has been collected over the calendar year 2009, and covers the SCA Group, including wholly and majority-owned subsidiaries. For further information regarding the sustainability report and its reporting principles, see page 65.</p> <p>SCA at a glanceSCA creates value by fulfilling the needs of customers and consumers in a spirit of inno vation, through continuous efficiency enhancements and with an expressed desire to contribute to sustainable development. We develop, produce and market personal care prod ucts, tissue, packaging, pub lication papers and solid wood products in more than 100 countries.Share of Group net salesEurope Global</p> <p>Share of Group net sales</p> <p>Share of Group operating profit</p> <p>23 % 32 %</p> <p>Personal CareSales in some 100 countries worldwide. The business area comprises three product segments: incontinence care, baby diapers and feminine care. Production is carried out at 23 plants in 20 countries.</p> <p>MArkEt PoSitionnorth America</p> <p>Products</p> <p>Incontinence care Baby diapers Feminine care</p> <p>1 3 3</p> <p>3 </p> <p>1 4 5</p> <p>Share of Group operating profit</p> <p>37 % 39 %</p> <p>MArkEt PoSitionnorth America</p> <p>TissueSales in some 80 countries worldwide. Tissue consists of toilet and kitchen paper, facial tissue, handkerchiefs and napkins. Production is carried out at 36 facilities in 18 countries.Europe</p> <p>Products</p> <p>Consumer tissue Away From Home Tissue AFH</p> <p>1</p> <p>1</p> <p>3</p> <p>Europe (including Africa)Sales, SEKm Employees Women, % Salaries, SEKm Social security costs, SEKm</p> <p>200984,414 34,084 24 13,544 4,055</p> <p>200887,055 36,182 25 12,504 3,471</p> <p>Employee age distribution% 50 40 30 20 10 0020 2130 3140 4150 5160 60+</p> <p>AmericasSales, SEKm Employees Women, % Salaries, SEKm Social security costs, SEKm</p> <p>200915,936 7,701 30 1,994 650</p> <p>200814,593 7,726 37 1,672 488</p> <p>Employee age distribution% 50 40 30 20 10 0020 2130 3140 4150 5160 60+</p> <p>Global</p> <p>3</p> <p>3</p> <p>Share of Group net sales</p> <p>Share of Group operating profit</p> <p>25 % 4%PackagingSales to some 50 countries in Europe and Asia. SCA is a fullservice packaging supplier that offers both transport and consumer packaging. Production is carried out at about 200 facilities in 28 countries.</p> <p>Share of Group net sales</p> <p>Share of Group operating profit</p> <p>15 % 25 %Forest ProductsSales primarily in Europe but also in North America and Japan. Production comprises publication papers, paper pulp and solidwood products and is carried out at 12 facilities in 3 countries.</p> <p>Asia PacificSales, SEKm Employees Women, % Salaries, SEKm Social security costs, SEKm</p> <p>200910,506 7,746 39 1,058 169</p> <p>20088,802 8,091 42 967 115</p> <p>Employee age distribution% 50 40 30 20 10 0020 2130 3140 4150 5160 60+</p> <p>SCA Group totalSales, SEKm Operating profit, SEKm Operating profit, SEKm1) Earnings per share, SEK Earning per share, SEK1) Employees Women, % Salaries, SEKm Social security costs, SEKm1) Excluding</p> <p>2009110,857 8,190 9,648 6.78 8.32 49,531 27 16,596 4,874</p> <p>2008110,449 8,554 8,554 7.94 7.94 51,999 29 15,142 4,074</p> <p>Employee age distribution% 50 40 30 20 10 0020 2130 3140 4150 5160 60+</p> <p>items affecting comparability.</p> <p>See page 47 for more key figures.</p> <p>Highlights 2009 ecisiontoinvestinanewlimekilnthatwillsignificantly D reduce carbon emissions at strand pulp mill. Page 23. neofSCAstwowater argetswasachievedayearearly. O t Page 31. llEuropeanpaperandpulpmillswerefittedwith iological A b water treatment units. Page 32. eliveriesofFSC-certifiedpaperncreased45%.Page26. D i valuationofbusiness thicsinRussia.Page35. E e eportingsystemfornon-compliancewiththeCodeof R Conduct established in Asia. Page 36.</p> <p>CEo statement</p> <p>The business community must take the leadOver the past number of years, it has become evident that the issue of sustainability has taken on a new guise. It is no longer a matter of legislation or image, or indeed can it be reduced to emissions or resources. Sustainability issues cannot be treated separately; they are now the hub from which the future development of our society and our world will emanate.</p> <p>For us in the business community, this is a dimension that we must seriously consider and one that will require entirely new questions and new answers. Ultimately, it is about ensuring the relevance of our companies in tomorrows society. Sustainability is very much a global issue and influences all aspects of enterprise, from capital to employees, customers and suppliers. SCA is a global company with operations in about 100 countries and our business has a broad interface with all types of stakeholders. During the year, we received acknowledgement that these stakeholders appreciate our way of working with sustainability. Environmental and social parameters are becoming increasingly important to our shareholders and we can see that the proportion of shareholders with a marked sustainability profile is growing. The year 2009 has been a difficult period distinguished by the recession and financial crisis. In this harsh competitive environ ment, SCA has secured more customers and contracts through our pronounced and transparent sustainability strategy. Young coworkers choose to work at SCA for the same reasons. Climate change has established itself at the top of the environ mental agenda in recent years a situation that will remain for the foreseeable future, since it ultimately involves our survival. The busi ness community holds a number of keys that can help resolve the issue, which is especially relevant at a time when the governments of the world are finding it difficult to agree upon common targets. The key role of the business community was also highlighted by Professor Jeffrey Sachs from Columbia University in the US, one of the worlds most influential economists, in connection with a water seminar in November arranged by the SwedishAmerican</p> <p>2</p> <p>SCA Sustainability report 2009</p> <p>CEo statement</p> <p>Chamber of Commerce in New York, which was attended by SCA. In this speech, Sachs explained that he has placed his hope in the business community and the ability of companies to implement change in the environmental area. The challenge is to discover new solutions and promote the right behaviour. For example, a sign of the times is the doubt that has been thrown on the concept of Gross Domestic Product, GDP, since this does not take into account the cost of growth on the environment. The EU and OECD are working on the develop ment of alternative measurement methods, such as the Genuine Progress Indicator, GPI, which takes emissions and environmental impact into consideration. For SCA, sustainability involves viewing our business from a global perspective and being prepared to rethink deeprooted beliefs and methods of approach. Are we using the appropriate technology? How can we minimise the products environmental impact? Can we find new ways to distribute our goods? One example of innovation is ESAVE, SCAs Groupwide programme to reduce energy usage and environmental footprint. By involving employees in the work since the projects inception in 2003, approximately 900 smallscale projects have been exe cuted, resulting in significant reductions in energy consumption and carbon emissions. New solutions also involve understanding the external environ ment and its requirements. In this respect, environmental associa tions and NGOs play an important role as examiners and opinion makers. The dialogue is not always free from criticism, but neces sary. By confronting and addressing criticism, we broaden our out look and the basis for our decisions and gain greater knowledge.</p> <p>Deforestation in the world is one of the greatest contributing factors to climate change, but the forests significance in solving the problem has been overlooked. Trees are unique insofar as they are renewable and absorb carbon dioxide. The growth in SCAs wellmanaged forests exceeds harvesting, which means that they absorb 2.6 million tonnes of carbon dioxide net on an annual basis. This almost corresponds to the carbon emissions from SCAs entire production. If all the forests in the world were man aged in an equally responsible manner, we would be a large step closer to resolving the climate issue.</p> <p>Jan Johansson, President and CEO</p> <p>SCA Sustainability report 2009</p> <p>3</p> <p>Sustainable strategy targets</p> <p>Target 1. Carbon dioxide from fossil fuels shall be reduced by 20%Since 2001, SCA has worked actively to reduce emissions from fossil fuels. In 2008, SCA further raised its ambition and introduced a new quantified CO2 target that requires the Group to reduce emissions from fossil fuels by 20% by the year 2020, using 2005 as a reference year.</p> <p>SCAsCO2 targetSCA will reduce its carbon emissions from fossil fuels and from the purchase of electricity and heat, relative to the production level, by 20% by the year 2020, using 2005 as a reference year.</p> <p>Activitiesin2009SCA continued its focused efforts to strengthen the Groups climate work and reduce carbon emissions. SCAdecidedtoinvestSEK500minanewlime kiln at the strand pulp mill in Sweden. The investment will dramatically reduce strands carbon emissions from fossil fuels. SCAsextensiveinvestmentsinwindpower, made in cooperation with the Norwegian energy company Statkraft, proceeded. TheGroupinvestedheavilyinthepapermillin Laakirchen, Austria. The investment will entail significant reductions in carbon emissions from the plant. Investmentsinnewtechnologyformechanical pulp production in the Ortviken paper mill in Sweden will reduce the electricity needed per tonne pulp by 10%. AlargenumberofESAVEprojectshavefurther reduced carbon emissions and saved electricity.</p> <p>Resultsin2009At year-end 2009, carbon emissions had declined by 2.2% relative to the production level.% 2005 2009 2020</p> <p>5</p> <p>10</p> <p>15</p> <p>20 Target</p> <p>DrivingforcesThe climate issue is one of most critical environmental and social issues facing the world today. Background factors include the following: AccordingtotheUNsIntergovernmentalPanel on Climate Change, the earths average sea and surface temperatures continue to rise. This increase is attributed to emissions of greenhouse gases resulting from human activities. Tradinginemissionrightshasbeenintroduced in the EU and, in New Zealand, a similar system is being planned. Inthe1997KyotoProtocol,aninternational agreement aimed at reducing global emissions of greenhouse gases was reached.</p> <p>4</p> <p>SCA Sustainability report 2009</p> <p>Sustainable strategy targets</p> <p>Target 2. 100% control of freshfibre raw materialsSCA is Europes largest private owner of forestland and the Groups own forests have been certified in accordance with the FSC, Forest Stewardship Council, since 1999. SCA also purchases large quantities of freshfibre raw materials from external suppliers. SCA attaches great importance to the respo...</p>

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